Your Future Self Deserves Better Choices Today
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January 27, 2025
TLDR: In this podcast episode, Rachel Cruze & Jade Warshaw discuss various financial questions such as dealing with in-laws offering money to move closer, saving for a house on a low income, managing investments, college expenses, deed ownership, and other related matters.

In this episode of The Ramsey Show, hosts Rachel Cruze and Jade Warshaw tackle various financial questions from listeners, focusing on how today's decisions can positively impact your future. The discussions range from home-buying dilemmas to saving strategies and investment concerns.
Supporting Your Family's Move
Question from Chris in Dayton, Ohio
Chris shares that his parents offered financial assistance to help him and his wife move closer to them after the birth of their child. They are hesitant about accepting the money since it feels like borrowing against their inheritance.
- Key Insight: The hosts suggest viewing this as a gift that can help them secure a better future for their family. Rachel highlights that earlier financial help can benefit children more than a later inheritance, enabling them to invest wisely.
Saving for a Home on a Low Income
Question from Catherine in Portland, Maine
Catherine, a stay-at-home mom, expresses frustration over a consistent cycle of saving for a house only to incur unexpected expenses that drain their savings.
- Advice: Rachel advises looking for ways to increase household income through side hustles or reducing expenses. The emphasis is on building momentum, so they can save effectively while also managing life's unpredictability.
High-Level Investment Questions
Question from Richard in Tampa, Florida
Richard is contemplating whether to invest a significant portion of his income into 401(k) savings while managing a new motorhome purchase and preparing for retirement.
- Discussion Points: The hosts discuss the balance of investing versus ensuring future housing stability. Rachel advises pausing high contributions to funds until more stable housing is arranged, as investments and housing security both play critical roles in financial health.
Tackling Debt with a Strategy
Question from Andrew about Health Costs
Andrew's family is facing a significant medical bill for an experimental treatment that is not covered by insurance. He grapples with whether taking out a loan is the right move.
- Recommendation: They suggest pausing debt repayment while saving for the treatment. They also emphasize that considering cash payment can encourage finding alternative solutions beyond loans.
Open Conversations about Finances
Question from Michaela in Kansas City
Michaela, 22, wants to have more open conversations with her parents about her current debt situation. She feels guilty about her financial mistakes in the past and worries about her parents' perception.
- Key Takeaway: Jade encourages Michaela not to carry guilt over her past decisions. She emphasizes that open, honest communication could strengthen family relationships, and that vulnerability is vital in fostering trust.
Navigating Home Ownership Dreams
Question from Tanner in Tampa
Tanner is contemplating whether to buy a starter home or wait to save for a forever home.
- Insight: Rachel and Jade recommend focusing on a starter home. They highlight that many people often change housing needs as life evolves, especially in their twenties. The focus should be on buying responsibly and setting a realistic budget, while remaining open to future changes.
Practical Steps for Immediate Action
Overall, the hosts provide strategies for these various financial concerns:
- View gifts positively: Accepting financial gifts from family can secure a safer future for your own family.
- Increase Income: For families on a tight budget, exploring additional income streams or making sacrifices in current living situations can build savings momentum.
- Prioritize cash flow: In complex financial situations, managing cash flow prudently can prevent unnecessary debt, especially regarding emergency and planned expenses.
- Open communication: Maintaining transparency about financial issues within families can lead to better planning and support.
Conclusion
The episode underscores that proactive financial choices today set the foundation for a more secure and prosperous future. By addressing immediate concerns, families can navigate their economic challenges more effectively while paving the way for long-term success. Tune into The Ramsey Show for more insights on achieving financial freedom!
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Live from Ramsay Solutions, it's The Ramsay Show where we help people build wealth, do work that they love, and create amazing relationships. I am Rachel Cruz hosting This Hour with my good friend and best-selling author, Jade Warshaw. And we are answering your questions. So give us a call at 828-825-5225. We'll talk career, relationships, money, anything and everything. So give us a call. We're going to start off this hour with Chris in Dayton, Ohio.
Hey Chris, welcome to the show. Hi, thank you for having me. Absolutely. How can we help?
So my wife and I recently had our first child. She is a daughter, which is obviously awesome. Thank you. And my parents live in Columbus, Ohio, which is about an hour and a half away. And naturally, they would like to see us and their grandchild more. We are looking to upsize our home and we were looking in the Dayton area originally because cost of living, we can afford it.
They then offered to give us an additional, the difference between the prices of the home and date into Columbus that would go towards our down payment, making it affordable if we move to Columbus. That sounded good. It would be a gift, not like a loan. But then they mentioned that they would have to make it even and change
The will slightly so that money was even with my sibling. So I got an extra $100,000. My brother would get $100,000 on the wall, et cetera. So then I started booking it as like an interest-free loan against myself in the future. You're saying because if you had received it as inheritance, you would have done what with it?
Well, it's not that I would have received a hair though, I'd done anything with it. It just that it looks like I'm borrowing from my inheritance, which is weird because my wife and I worked really hard not to be in debt at all. Well, I wouldn't think of it as borrowing. You're just getting a piece of it earlier. Yeah. For something that you want to spend it on. It's not a lie. So you think that's fine. Amen.
I do. It feels like a gift. Very much so. And as long as your parents in a good financial situation to give you this cash and it not hurt them. Listen, I hope that one day, I mean, one day I will be there when my kids buy a house and I'll be like, here's some cash to put towards your down payment. That's what I plan to do with Sam. And so I don't think there's anything wrong with this.
If it's a place that you want to be, it keeps the payment where you had it originally. Rachel, do you see anything? Yeah, for sure. No, not at all. Again, you trust there no strings attached, that it is a free and clear gift. What's interesting, Chris, there's a book called Die with Zero, and it's a really interesting read, and one of his takes that majority of people cannot do. A lot of people are not in your appearance position to have the cash flow to do something like this.
But he was saying in the book, if you did, that actually your kids would benefit more from your money in their 20s and 30s than they would when they're 60 and 70 when they received the inheritance. So it's actually, I would see it not as borrowing against your inheritance. It's actually putting you in a better position 30, 40 years ahead.
to get you getting your house paid off that much faster to invest that much more for your kids. Does that make sense? Like it almost is a better use of that money that earlier you get it. If you do something wise with it, like put it towards real estate. Does that make sense?
Yeah, that makes sense. And we are in our late 20s. So that kind of checked out. Yeah. So this is great. I love this for you. I feel like this is exactly what it's all about. Like it's all about having your money in order so that you're able to put the next generation in a better position. And so this is really money doing its doing God's work.
to do what it should. Well, I hope that helps Chris. And I would say to, you know, to something to think about for yourself, Chris, is, you know, are you in a position emotionally to be okay with being given money? Because I know there's a level, you know, not to stereotype, but you know, even some dudes like there, I don't know. There's there can be something to feel weird. I'm like, Oh my gosh, I'm getting helped by my parents. But what I would say to that, again, if the relationship is healthy and good, like,
Put the ego aside, receive the gift. Yeah. Because that's, yeah, I mean, I think you're, I think it's fine. I feel like it could definitely feel different if it's, if you're the, I'm not trying to enforce gender roles on anybody, but I feel like it could feel different if you're the guy and it's like the mother, your wife's family doing it. Yeah. Yeah. I feel like it could feel a little different. Totally. Listen, the gift is a gift. It's a blessing. Yep. That's great, Chris. Awesome. Okay. I'm next. We have Catherine in Portland, Maine. Hey, Catherine, welcome to the show.
Thanks for taking my call. Absolutely. How can we help? So we live in a single-income household. I'm a stay-at-home mom. We do side hustles. But basically, we've been in a rent-wash repeat cycle our entire marriage for five years where we are debt-free. We are able to save a few hundred dollars every single month. And we're trying to stay for it down here on the house.
Um, but pretty much what happens is we either get hit with like, we had my daughter two years ago. So we had a big medical bill or we had to buy a new car. Um, you know, new to us to the car, but yeah, it's like that savings gets depleted and it basically takes us, you know, a couple of years to save up, you know, double digit money. And then we have to spend it on something big. Um, so I just see that happening again in the next couple of years, like we have our cars,
But when I look at saving for a down payment, I think it's going to take at least five to seven years, maybe longer. And I'm looking at our cars and I'm like, well, we're going to need to buy a car. I mean, what you're talking about of how to do that. What you're talking about is so common, whether it's saving up for a down payment or if it's just I'm trying to get three to six months saved, whatever it is. I find that when your income is low, you've got to do something that's going to create momentum.
so that you can like build up that speed to get over that wave, right? And so for you guys, it might look like building up income, working extra for a season so that you can really get past those hurdles that you see and kind of get that footing under you. Because the truth is all the things that you're talking about, I mean, that is life, right?
Cars break down. It's time to replace the, you know, having babies. Yeah, having babies. I mean, all of that is just kind of part and partial to life. And when you have a lower income, you're right. It does. It feels like two steps forward, one step back, right? So you're going very slowly. And I challenge you to say where is an area that you can pick up work? I mean, you said your stay at home mom. It sounds like you have a two year old. What could you do to add to the income? What could your husband do?
Yeah, he's working overtime. I have side hustles. I'm especially aware. How much you guys make in a year, Catherine? About 65,000. OK. And then, yeah, the other question is where you're renting now, what percentage of your income? Because it could look like, OK, we're going to sacrifice where we're renting now. Maybe we go to a smaller place, and that frees up enough margin that we can get this done a lot faster. So I would just challenge you to look at some of those areas that maybe you thought were untouchable.
because we all have those areas that we kind of like hold close. That's like, I'm not changing. You know, this is my apartment. We're comfortable here. I'm not moving or this is my schedule. It works for me. I'm not changing it. And unfortunately, a lot of times our opportunity rests in those areas where we're comfortable. Yeah. So let me have this too. So in like the baby stuff. You're good. You're good. Go ahead.
I'm sorry. And the baby sublisted says that like you pay off your debt and then you start investing a retirement. So like my husband and I, he works for the state and because of that, he has to walk into like the state retirement system. And we're like, okay.
Okay, so sorry, Catherine, I'm gonna have to put you on hold because we're about to hit a hard break. So yeah, if it is dictated to you, then cut that in half and half of that would go towards your 15% if that makes sense. So sorry to cut you off to get you there, but I hope that helps, Catherine. Thanks for the call. For free tools and resources to help you reach your home goals, go to ramsysolutions.com slash real estate or click the link in the show notes.
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Welcome back to the Ramsey Show. I am Rachel Cruz, hosting this hour with Jade Warsham. We are taking your calls at Triple 8, 8255 225. Up next, we have Richard in Tampa, Florida. Hi, Richard. Welcome to the show. Hi, thank you for taking my call. Absolutely. How can we help? Well, the reason I was calling is I just recently changed my fidelity 401k account. And I've
I actually brought it up to 75% of my income. And we have a military pension, and my wife works. And so, but my question is, we've recently purchased a brand new motor home, and that is our residence. And so we have no other bills other than the motor home itself. And we weren't sure whether or not I should be investing like I am into my 401k. I didn't mention that I am.
I'm 58. I would like to retire at 62 as well as my wife. So we're just a few years out from that. And so we're just going, I wanted to get the money into the market as early as I could in this new year. And so we're, you know, I just, I upped it up to 75%. I wanted to see if that made a good sense or not. If it makes a good sense. How much do you have currently in your retirement? I have 117,000 in my 401k.
And my wife has about 13,000 in hers. And yeah, I guess that's about it. And then we do have our high-yield savings that we're using for, we have money in there for our emergency funds. And the 75%, what does that amount to every single month that you're putting away? Well, right now, I haven't seen my Facebook, but somewhere in the proximity of 1600 to 1800 every two weeks is going into that.
Okay. And then I'm getting a paycheck of like $390, close to $400. Okay. And I put that into the high yield. And then you're using your wife's income for you guys to keep a float bills and stuff. Is that right? And the military pension. That's correct. Okay. And the military pension. Okay. Okay.
Um, you know, I'm not mad at a catch up of considering your age and you guys want to retire in the next, you know, four or five, six years. Um, because you don't, I mean, 117,000 won't, won't get you into retirement. So I understand the, the, the aggressive catch up, right, right, right, to get there. My only concern, Richard, is do you guys, do you guys own a home as well as, um, having the RV? No, we don't. We, uh, we actually sold our house a couple of years ago.
And we located to Tampa. Okay, where did that money go? From the sale of your home? Well, we paid off our car and then we bought another, we bought another camper and we paid cash for that. So that wiped us out of all that. So we, we became debt free at that point. Okay. And so. So I'm just thinking a lot. Okay. So my only hesitation is, and again, you can do this later through your investments after you retire.
But one thing to consider is that the one line item in your budget going into retirement that we won't stable is housing. And I just wonder if a camper is going to be literally your housing until the end of life. And it probably won't be. So I would be thinking towards we're going to have to buy something.
very small and inexpensive, but coming out of this retirement savings eventually. Again, it may be in 15, 20 years, but think about the market continues to grow, so housing is only going to get more and more expensive. That's my only concern about this plan in general, is something that just to be thinking about, your primary residence is something that's going down in value.
in a mobile home, or in a camper, and you probably aren't going to live in that for the rest of your life. So I would be thinking about housing long-term. What's your pension? What will you receive monthly? Right now, well, with disability, it comes out to $2,500 a month. Okay. And what do you, at this point in you guys' life, what's kind of that number that makes your budget run, just kind of your normal month-to-month budget?
Yeah, our month-to-month budget, and this includes putting, we have money that goes to our grandkids. We save for them. And we also have an extra that my wife has out of the budget. But it's like around $5,500. But that also, out of that, there's 800 of it that goes into savings. So it actually could be a lot with ours. It'd be like $4,800 maybe.
or 46 hundred. Yeah, something like that. That's not what it costs to operate. So that includes the payment of the motorhome. And we do use it. We do use the every dollar. We're religious about that. You love that app. What's the motorhome payment?
13, $1,300 a month. Yeah, I agree 100% with Rachel unless you guys have decided that this is just your way of life forever and you have just given the finger to home ownership. I agree with what Rachel is saying. I think you do want to stabilize that and you probably want to get into something that you, not only that you can afford right now,
But you'll be able to afford in the long run if your income changes, if you stop working, that sort of thing. And so you guys have a lot to think of here because 2500, while it's a stable amount, that'll be coming. It's not very much, right? Yeah, I do want to. I mean, at this rate, if you keep saving at the rate that you're saving, yeah, you'll be.
close to a million, a little less 850 maybe. And so I see why you're trying to kind of speed that process up. Now is the time that I'd be putting the pedal to the metal and bringing in as much income as I possibly could to save up not only for a down payment, but keep investing that 15% and get this thing done.
Are you saying that you would recommend that I back off my contribution? Or would you leave it at 75 and go like, or are you saying? Well, I just don't see how you're going to be able to save up for a down payment on a secure home at 75%. Unless you see a way that I don't see. No, no, I get it. I agree with you. I just I wasn't sure whether or not I needed to back down my
my contribution to my fidelity account, and then go aggressive. I have contemplated that. You could do up to your catch up contribution, which is still not going to be 75%. I don't think. What's in the high yield savings? What do you have in there? We have $14,000 in that. What is that six months of expenses? Is that five months? What is that?
That's probably about five months. OK, so I'd keep that just like that. And yeah, I mean, it's really going to be you balancing how much do we need to save for a home and then doing kind of working backwards and saying, OK, this is what we need to save. How long will it take?
And at this savings rate, and then you say that takes too long, let's come back further. Truly, if you're walking the baby steps, truly, what you would do is you would back it all the way down to 15%, save up for that down payment, and you would start knocking away at that home payment before you upped your fidelity contribution. Yeah, and how much is left on the camper, debt-wise? Well, we just bought it. We've only had it for about three months.
It was expensive. We have about 150,000 left on that.
Yeah, the problem is what Rachel and I are asking you to do, you're kind of investing on two ends. You've got your retirement fidelity investment, but when you buy a house that's also investment, it's something that's going up in value. So while it may feel like you're pulling away from your 401k or fidelity investment, you're actually kind of diversifying in that way. Whereas now you're putting money into something that's going down in value. And do you see what I'm saying? So Rachel and I are giving you two income tracks as opposed to just one.
Yeah that makes good sense. I like that.
All right, I hope that helps, Richard. Thanks so much for the call. Thank you for taking my... Yeah, thank you so much. That's a good guidance. I appreciate it. Absolutely. Well, thanks so much. And when we talk about that, you should not own anything with motors and wheels that is more than half of your annual income. Richard's going against that, but this is where he's primary living, which again, from a long term, I don't recommend because unlike real estate, if you go and buy,
to bedroom condo somewhere, it's going to go up in value, where a camper is going down. And so to put all your eggs in that basket at this age, it is scary, Richard. And so, yeah, I mean, I don't think I realize you owed that much on it. So almost backing down, paying that off.
I wouldn't pay it off. I just, I think they need to get into a house sooner than later. Like as quickly as they can afford it. Or even selling the camper. Yeah, I don't know. I don't know. There's some options to look at. Well, thanks Richard again for the call. This is the Ramsey Show.
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With the last caller, we were talking about real estate and what that looks like to start saving up towards a home. And you guys, when it comes to buying and selling your home, there's a lot of decisions. It can feel very overwhelming, but you don't have to go through that process alone. We created Ramses Real Estate Home Base. So this is a place with so many resources and tools like calculators, start to finish guides, how two articles, a podcast, a book, a video course, like everything around the subject of real estate.
Because, again, buying and selling, it can be an overwhelming process. And the more information you have that you understand and you know, the more clarity you're gonna have walking into that, which is huge. Like you wanna be armed with so much information before you go and buy or sell your home. So make sure to check it out at ramsysolutions.com slash real estate or click the link in the description if you're watching on YouTube or listening on podcast. Because if you need some next steps towards your home buying or home selling process,
Make sure to check it out. One of my favorite things on it is the dashboard. They have the US housing market trends, and they keep it updated. And it's just constantly kind of a pulse of what's going on with interest rates, median house home prices in America, total days on the markets, how many homes are for sale around the country. I mean, it just kind of gives you the snapshot picture of the real estate market. So again, you can go to ramsysolutions.com slash real estates.
All right, we're going to the phones and we're going to Andrew and Cheyenne, Miami, one of my favorite, one of my favorite country songs. Hey, Andrew, welcome to the show. Hey, thanks for having me. Absolutely. How can we help? Hey, so my wife and I were on baby step two. And it kind of took us a little bit to get there, mostly because we've been pretty sick, both of us for the past few years.
And we're seeking some medical treatment to hopefully nip this in the bud, hopefully in a few short months. But the medical treatment that we're looking at, that was recommended by our doctor is experimental. And it's not covered by insurance and the treatment can be between 10 to $30,000. So we're kind of in a position where we. Are you there, Andrew?
Oh, no. Oh, man. Andrew, we'll give you one more second. Oh, yeah. I, that's a bad line. I think, um, we're going. Oh, there you are. You're back. Yes. You're good. You're good. My phones are a little weird. Um, so, um, yes, I don't know if my wife and I should actually, um, take out a loan or not. We really don't want to, um, especially since we're, can I ask Andrew and share as much as, as you feel comfortable, but what's, what's going on health wise?
Um, we were, um, so we, we got pretty sick from the, the, the home that we were living in. Um, and so it's been, it's been, yeah. So it's just been a lot of stuff that's been going on where, um, a lot of the treatments have been not either FDA approved or, um, treatments that have been getting us better. We're, we are better, but it's, it's just been a really long process. So the last time we talked with our doctor, he said that,
We should try and do like a hyperbaric treatment, which seems great. You know, he's had great success with it. But the only problem is that the pain has to be upfront. And so that's the only issue. This is obviously something more like in a natural bent, I'm assuming. So insurance isn't going to cover it.
No insurance won't cover it. Tell me just how wise are you guys able to work? Are you able to function? Like how are you guys? You said you're doing better. I'm just trying to get a gauge about how urgent this is for you guys. Yeah. So we are better and we are both working right now. We'll make about, I want to say close to 70 or $80,000 right now a year. Okay.
The only problem with this is that the longer we put it off, the worse it'll get. What's your margin every month? What are you right now putting towards dead and baby step two that you could put potentially towards saving up for this or doing one at a time? Yeah, we're able to put close to $600 or so months into dead. How much debt do you guys have?
Right now we have about, I want to say about $20,000 in student loan debt and then about 50,000 in a business loan.
Um, man, this is so hard because I do feel like they're just from my own, not my own experience, but people within my close circles of friends and family, even that I know, you know, when you get something, it's like auto immune or mold or whatever that it can end up feeling Andrew, like.
There's always something else we have. Like there's a long line of things that are continual. And so what I, you know, always just think about and kind of caution is I would number one, maybe get a second opinion. I'm sure you know your doctor well and trust them. But you know, we're talking about 10 to $30,000, right? I mean, if it was $2,000, that's one thing. But I mean, you're talking, you know, five figures going in with treatments. And so is that a piece or?
That would be for us combined. And is this ongoing or is it kind of a one time?
Lord willing it be, it'd be just a one time like, you know, one, one to two months worth of treatment. So it'd be 20, 20 sessions is like, is about $1,000 on the high end. So we hope to be done in about a month. Okay. So, you know, what, what I would probably do, because again, I feel like this can sometimes feel like a never ending cycle, um, I would, I would
And because it's not a and I know you guys are saying I don't want to downplay it all the sickness I'm sure it's just miserable But it's not a life or death like okay. I have to save my child right now because you know, there's a you know, like it's not this urgency But it is something for the betterment of your health you want So what you know what I would probably strive to do is whatever I could to get because 10 to 30 is a big range So I would get as close to that 10 and I would talk negotiate doctors bill. I mean I would do whatever I could and
to get it down to that 10. And you guys are saying, you know, I would work to save a thousand a month. I would be okay right now because it is a health issue, maybe to pause the debt snowball, stay current on your bills, but I would bump that 600 a month up to a thousand and save for 10 months. And then starting October, November, Andrew, start this treatment. And then hopefully by this time next year, you're through it, you're done and then press play on the baby stuff. And maybe one of you goes out of time to see if it's helpful. Oh, that's a good point. You know, I know you're two different bodies with two different sets of
You know, but that might be a good way to say it. Listen, I did it. It did nothing for me or I did it and it really, really helped. That might give you some confidence going into the next treatment. It's just a thought. Like I don't know what you're facing. I don't know if it's headaches or every time you eat, you know, whatever it is. If it's something that's truly debilitating, but if it's just.
Again, I don't want to downplay it either, but if it's something that's more of an annoyance that you're learning to live through, that gives you, there's a little bit more timeline there to get this done. For sure. The sense too that you don't want to prolong it too long because of what you're saying, they can come back and get worse unless you have the treatment.
Getting to it right a level of urgency, but it's also not like we have to do this next month The only option is alone and we're done like yeah if you can and it's not debilitating because you guys are working and all that I would yeah I would find something because I know I would cash flow it and and the other thing Andrew that's interesting is when you are working with cash
Even when we're talking about health situations, it does force you. This is why I like cash forces you to look at other options, other decisions, like sell something. There's just other parts of your brain of problem solving versus with debt. It's like, here's a chunk of money. This is all we're going to do. We don't really have to pit the brain power to think through other things. It's just here. But when you're paying with cash and you're working and saving hard,
I don't know, it forces other things to come to the surface of other options and choices. That's also true. But yeah, so again, I'm so sorry. That's very tough. And that has been, I don't know, I don't know if you've, or I've just had people and it's like, you go to the next thing and then it flares up again. I don't know, it just feels like it's like whack-a-mole a little bit sometimes with different things. So I do want you guys to get that treatment, but because it's not life or death right in this moment,
I would I would calm down. I mean, I would I would pause a little bit and save up for it. That's difficult. I remember when Sam and I were getting out of debt. This was before the days of Obamacare and you had to have insurance or penalize. We didn't have insurance. And one day he was pulling our luggage out of the back of the Jeep and got caught on his finger and he broke his finger. Oh, no.
And we didn't have insurance. And I was like, listen, get over to Walgreens, tape it up, tape it up. It's crooked to this day. And you know, he plays insurance. It wasn't good. Take care of yourself. Take care of yourself. This is The Ramsay Show.
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Welcome back to the Ramsey Show. Up next, we have Michaela in Kansas City, Missouri. Hi, Michaela. Welcome to the show. Hi, can you hear me right? Yes, we can. How can we help? Hi, so I have a kind of indirect financial question. If you were not necessarily about my finances, but a conversation I would like to have about finances in my family. OK.
Um, so just a little bit about my situation. I am 22 years old. I'll be turning 23 on Sunday this upcoming week. Oh, happy early birthday. Thank you. From 2021 to 2024 is when I occurred all of my debt to around 30,000. Okay. And so my question is I would like to, um, I've been taking care of it since
September of last year to now, which originally was 37,000 plus. But since then, I've taken care about seven to eight grand of it so far. Good for you. That's great. Thank you. My concern, though, is that while I assured this step, neither of my parents know anything about it or about my financial situation. Do they support you financially in any way?
So yes and no. My father, he doesn't live with us, but he is supportive of me. If I were to need some financial situation or some financial help, he would. And I live with my mother and my grandmother. But considering how much I make, I make enough where I think I'm okay enough without asking for help.
Yes. What caused you to go into the debt if you were in this or were you not in this living situation before? Either way, what caused you to go into the debt?
Before, if you were to ask me that question, I would have made up a lot of excuses, but I've worked on it enough and made enough accountability to say myself, come 2021, I had kind of moved out from my mother's house and lived with my ex. And so it was through some immature purchases on Mayan and his and I had set up a joint account for the both of us.
And so he was taking out most of the money between how much we were both earning and I was the more so the breadwinner compared to what he was making. And I was, I was okay with it. I would have just liked a heads up because I was working about maybe 60 plus hours a week. So he was using, he was using your, yeah, he was using your money plus going into debt under your name.
Yeah. Um, I was, I was really stupid. Yeah. So we all make mistakes. Yeah. It was just, I was just trying to more of a clarifying question, making sure I understood the situation. Okay. So my next question is, why do your parents need to know? Well, the reason why is because my mom and I have, um, been talking a lot more and one of my biggest goals for this year is to be more open and honest with the people in my life, my loved ones, my parents,
And I want more instead of like a child-mother relationship, since I am getting older, I want more of an adult relationship with my mom. The other two really big concerns are since I work these two jobs, my mom has been open about what she sees in me and how they're both physical labor jobs. And so she says how exhausted I look and how tired I look.
The other part is our grandmother lives with us, but she has Alzheimer's. And so on top of working two jobs, I try to help my mom as much as I can with my grandmother. So are you saying that they're wondering, are you saying that you kind of want to give them some context as to why you're working so hard at the jobs you're doing? Is that what you're saying?
Yeah, I am. Do you want to tell me? I'm sorry. The other briefing was with everything going on politically. My mom has made it quite known to me how concerned she is about me and my family's well-being. And she has said consistently on numerous occasions, if things were to go from push to shove, she would like for us.
to leave the country. And so with her bringing that up, continuously having some experiences already. Are you guys from do you have a non US background? Is that what you're saying? Are you concerned about immigration? Is that what you're saying? No, we're African American. OK. Oh, I hear you. OK. Enough said. Here's what I'm thinking. Here's what I'm thinking.
I get what you were saying earlier. You're talking about a lot of different things. So let's talk about first the financial side of things. A, if you want to give somebody context without giving them a ton of details, that's fine. You can say, listen, I've got some debt I'm trying to pay off. That's why I'm working so hard. If you don't want to tell them the whole 30,000, hold on.
Do you want some more? I've got water. Sorry, guys. I'll take over for a second. Thank you. Go ahead. Give me a wave, Jade, because she's got some good stuff to say. Echoing on what she's saying is that you can have a deep relationship with someone and be able to share what you're going through of the struggle of, oh, yeah, I do have some debt I'm trying to pay off. That's why I'm putting in these hours.
And this is the why behind it. And I do agree you don't need to walk alone when it comes to your money. So having somebody in your life that has context and knows what's going on, I think is important. It doesn't have to be your parents. And I wouldn't say your parents have to know every detail of your life in order to have a
a close and great relationship. But if you want that peer-to-peer mentality too, Michaela, you are your own person as well. And so if your mom has, maybe you share in her fears or not, I don't know, but she can have her own mindset of what's going to happen for her future or what she thinks may have to happen. But also, Michaela, you're 22 years old, and so you get to make some decisions and decide for yourself
Hey, here's the reality of my life too, and just because my mom goes one way, I don't have to go that way either. Unless you do think that, right? And you may have context in that, which is totally fine. But I do think you are your own standing person at 22. Your parents don't need to know these things, but I understand opening up and wanting them into what's going on with your life, I think is great.
And if you want to tell them the number, tell them the number, like you didn't, you know, we always say like, dead is not a sin. It's not a salvation issue. You know, it wasn't some like big moral failure. Yeah. Yeah. You made some mistakes. You look back and I was stupid with my ex. Why did I do that? But listen, we all make mistakes. Like, like things happen in life, Michaela. So you're 22. Do not beat yourself up about it.
I couldn't have said it better myself. I just said it while I was in a coughing fit and she covered it. I don't know, jail you can probably have a lot better, more to some more to add. That was it. She covered it. That's exactly it. I won't repeat it, but I think, Michaela, you know what you have to do. And just listen, above all, don't be influenced by somebody else's fears. Like if they have fears and concerns, they're, they're, they're, um,
able to have those, everybody gets to have the emotional train that they want to have. And if you feel the same way, fine, but don't let it, if you don't, don't let that fear kind of lock you into something you should or shouldn't be doing with your money. Okay. I am. Thank you. Thank you, truly. I am. I'm sorry. I'm really trying not to cry. That's all right. What is it? What's what is making you want to cry?
That's okay. My dad are really big people in my life, and I really, really look up to him. We're not super rich, but I get my really hard work ethic from them. And so they taught me what I know about ideas, and I feel really, really dumb. I see. You feel guilty. I'm so worried that you should get disappointed in me. That's where I am.
No, what you're talking about is so real, like the guilt that we feel over previous mistakes that we've made with our money, the guilt that we feel having not met expectations that we feel were put on us or maybe that we've put on ourselves. What you're talking about, Mikayla, is such a real thing.
A lot of times when we think about getting our money under control, we kind of think it's just this light switch that we flip. All right, I'm getting on a play and that's it. And I just do it and I feel nothing until it's over. And that is simply not true. You go through a wide range of emotions and guilt and shame is one of them. But I want to tell you, Michaela, you may have made mistakes with your money, but you are not a mistake.
Okay? You are not a problem, a problem. You are not a burden. It was just something you went and you went through it and let those emotions go through you. Okay? It's when you get stuck in them that they become a problem. Yes. Yeah. It does not define who you are. Your past mistakes don't define who you are, Mikayla. So know that there's freedom in it and opportunity ahead. Thank you so much for the call. Thanks to all the guys in the booth. Thank you, Jade, for a great hour. This is The Ramsey Show.
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Live from Ramsey Solutions, it's the Ramsey Show where we help people build wealth, do work that they love, and create amazing relationships. I am Rachel Cruz hosting This Hour with best-selling author Jade Warshaw, and we are taking your calls about your life and your money. So give us a call at 825-525. Starting us off this hour in Los Angeles is Lori. Hi, Lori. Welcome to the show.
Hi, Rachel and Jade. Thank you for taking my call. I am beyond thrilled to have the two of you answer my question. Oh, well, I'm so glad you called. How can we help? OK, so I have a scenario that I have not heard, and I have been wanting to pick your brain for a long time. My question is basically, simply, what is the next best move to make based on your advice?
And my situation is I am 63 years old. I have moved back into a property I've owned for 28 years to establish. I had it. It was a rental property. I moved back into establish it as my primary residence to save $80,000 in taxes. Woo. OK.
Because of the, of it not being my primary residence, I wouldn't. Okay. Now, I don't own another property. I have 50,000 in retirement. I have an account that has 200,000 non-retirement. I spent $30,000 plus
Well, actually 40,050. I've spent $60,000 so far and I'm a year in. Like you're living expenses. Is that what you're saying? Lori, it takes $60,000 for you to live. Is that right?
Oh, I spent 60 above and beyond what I bring in on my income because I actually put the house on the market because I thought this is ridiculous and upside down and against my money philosophies.
And it fell out of escrow twice because there was a repair. Just, you know, things happen in real estate. Sure. So I had to spend. Okay. Wait, wait, wait, Lauren. Okay. Okay. Let me, okay. So you use 60,000 above and beyond your living expenses to fix up the house to sell. Is that what you're saying? Well, a part of that was fixing it. And part of that was, uh, you know, just, um, and additional to just keep the house running with insurance and, um,
utilities and whatnot. What is it costing you now to live there? What's the payment? It costs me $3,800 to maintain the house and a month. That's rent and what is that? Rent and utilities or is there something else we need to know about that goes into maintaining it?
Okay, so that includes my mortgage property tax, insurance, utilities, that is everything. I am super, I am also will tell you, I am a huge fan of, you know, our budgeting. I'll just lost it. Every dollar. Every dollar. Oh my God. That's great. She's like, I know it and I love it.
Okay, so I have, I am telling you the two of you, I know every penny that I lend and that comes in. So I am so organized here. So you're paying 3,800 every month with your mortgage all in, all included. What are you, what's, what's your top, top line of income? What are you bringing in every single month?
Okay, so I bring in about 90,000. My income can fluctuate, but I'm going to say that it averages, and this is on the conservative side, 90,000 a year. What's that look like monthly for you on a good month or a normal month?
It looks like probably, I'm going to say, let's just say 6,000, 6,500, 6,000. And here's a couple of things that are important to know. I thought at some point maybe I would pay this house off and stay here, but I don't want to be here, period. And I will also throw in an expired.
Because of the expenses, because I don't want to live in the area. It's far from my kids and my grandparents. Where do you want to be? And I want to be closer to where they are or.
I am willing to go a little outside of the area to stay within my personal comfort financially. Okay. Right now. What would that look like? Sorry. I'm moving you along so I can make sure that we answer you. Thank you. I'm fine. Okay. What that would look like is right now, honestly, creating some more freedom for myself, freeing up the equity that I have in the house.
getting accounts set up properly, renting for some period of time and something. And what location, Lori, is this still in California? Or is this like Arizona? Is this Missouri? Like, where are you talking? Well, unfortunately, those grandchildren are in California. So, but, you know, it is maybe outside of Los Angeles because you know, I'm in a fire zone too. So, yeah. So, Lori, what's your main question? What can we help you with today?
My main question, Jade, is, does it make sense for me to sell the house before it hits the two-year mark as primary residents? I would be foregoing about
you know, 70 to $80,000 of tax, you know. But I've already spent 60 and I'm going to spend another 30 or 40 for the rest of the year and I'm choking. What's causing you to, what's making you feel like it's to the wire that you have to do, that you would even consider doing it below the two year mark.
because it feels financially, absolutely so uncomfortable. Right, because it's more than half of your take on it. And what are you fixing when you keep saying, when you say I'm throwing an extra 40,000 at it, is that because it's almost $4,000 a month to keep it afloat, or is that an additional 40 on top of just maintaining it? No, that's an additional. So I'm going in more and borrowing. And is that because it's a broken down house? What's the extra 40 going to be going to?
Um, that's going to be just covering all the nut because, um, it's actually you're like, you're only making 60 six to 6,500. You're paying almost $4,000 a month for housing. So there's no way you can keep that. How much will you, how much will you, if you sold the house today for what you want, ideally, how much equity would you be walking away with? Um, I would be walking away with about one point.
1 or 1.2 million. Wow. Okay. And it'd be 80,000 in taxes. Is that what you were saying? Because of capital gains. I would want to know that the taxes would be because I bought that property for such so low amounts. The overall with everything said and done is still going to be like 300,000 of taxes to pay. Okay.
So it's like under that category of math is not a feeling. If you can hear, I am struggling every month. You're exactly right to feel this. I mean, this is far exceeding the amount that we would say it should be. I don't know. I don't see how you can keep this going without going into debt. I'd sell it. You're going to take the hit on the capital gains. That's fine. You made money. And then truly, you've got to get in a situation where you're getting that payment that's 25% of your take home.
Whether you're buying or renting for a season, still don't let it exceed that. Yeah, and Laurie, if you have the ability to get in a small condo to buy with this equity, I would do that versus renting long term, because eventually you're going to have to buy something and the sooner, the better. Thanks, Laurie, so much for the call. This is the Ramsey Show.
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Welcome back. We are taking your calls at triple eight, eight, two, five, five, two, two, five. I'm Rachel Cruz, hosting with the wonderful Jade Warshawn. And we're going to go to Portland, Oregon next. And we are talking to William. Hey, William. Welcome to the show. Hey, how are you doing? We're doing great. How can we help? I have a few questions, but, um,
So I'm looking at going into trade school or, well, talking, I don't know if that's considered a trade, but trade school, I guess. And I don't have enough in my savings. I just have enough for the emergency fund. Um, I'm currently on baby stuff, number two. Okay. And I have $24,600 roughly in debt. Okay. And so I was wondering if, um, I know you guys generally not to take out student loans. Um, and this is,
It's not a huge deal alone, but it's still money. It'd be six and a half thousand. And I was just wondering, should I pay off my debts first, which would take me around two years or... What would be the jump at income realistically from what you're making now to after you gradually? It would go roughly from 60 to 120, so double. Okay, okay. That's a good investment. How long is school for?
It would be roughly for about two months and then trying to get it done after that. Wow. How long would it be to get into, you know, because I know with that it's either you own a truck, you work for a company, like what kind of route are you thinking about?
Yeah, so I would be working for a company and I've already talked with the owner. Okay. And roughly around 100 is what he's going to be starting me at. Yeah, that's right. How can you get the 6500? How quickly can you save that if you paused your snowball?
Um, at my current, I'm probably in around four months, three, four months. That's great. I mean, honestly, William, that's probably what I would do. And the only reason I would say to pause your snowball to do this is the immediate jump and income and trucking for the most part. I know people can kind of get a little bit into the weeds. If you own your own truck, I mean, I know there's some expenses that can happen, but the path you're doing is very predictable. It's not like you're going to school to get a master's and
psychology and you're hoping to do X, Y, and Z. And it's a little ambiguous because it is such a short amount of school. And because it's pretty guaranteed. That's the, that's one reason why I would, or two reasons why I would say I would, I would pause. And how old are you young?
I'm 23. Yes, for sure. I would do that, William. Honestly, I would not for sure take out loans for it. I would save. And for you to be able to pay off 24,000 with 100 to $110,000 on the road where a lot of your expenses are paid, like sleeping, right? Like you're, you're going to have lower expenses too, just because of the lifestyle. Um, so you'll be able to knock out that 24,000. I mean, you can make an aggressive goal and say you're going to do it in six months and live on half of what you're making or, you know, something crazy. Yeah. You're used to living on 60,000. So why not?
Ooh, I concur, great. Yeah, that's kind of what I was thinking was once I get that jump in income, change absolutely nothing just because I have more, doesn't mean I have to spend more. Yeah, that's right. And then just knock it out. But also, my other question was, so out of that 24,000, 20,000 is auto loan. And I was wondering, sure, I just saw the car. Oh, tell us more. What's it worth? It's worth.
Roughly 36 to 38. It's a 22 Highlander. No brainer. Yes. Today, William. Today. And with what you get with it? You're going to be debt free. Yeah. You'll be debt free. Pay for a cash car or whatever. Oh, yeah. Pay for a cash car. Yeah. Wow. This is a good conversation. Thank you.
Yeah, you're rare, William, in the sense that your car is not underwater. We talked to so many people that have bought in the last few years when cars were so up in value, and they bought high and now they're trying to sell. And so you're... Yeah, I'm a very big... Yeah, I'm just like, when it comes to cars, like I was doing the research for months, I'd never buy any warranty than never did any of that. Yeah.
And I would not buy over MSRP even though I did buy in 2022 when cars were like crazy high and they were doing markups everywhere But it's holding its value that well, huh? I mean you Kelly blue booked it and that's what you're saying Well Kelly blue book private party. It's telling me around 41 But I've had it on Facebook marketplace for about 39 and no luck so far. Okay, so you're thinking 36 is that what you're saying?
36 is what I get to car max. I was like an instant offer. So if you let's just say you did that. I'm not saying that I would do that. But I mean, that gives you, you're going to come out of this with 15 or $16,000. That gives you enough to pay off the remaining debt. That gives you enough that you could pay for school and buy a junk, a junker. And you're only going to drive that beater car for a little while because you're going to be making a hundred thousand or maybe I'll drive you on the road because you're on the road. Yeah.
Wow, I love that this, this Highlander is breaking you free. This is great. Yeah, that's kind of like my original choice was like a BMW 750 and those just think like a rock. So I'm pretty glad I didn't do that. Well done, William. Also, I am a little like still disappointed myself that originally my budget was 3500 or 35,000. Sorry. And then I went and spent 55, but.
Well, you'll never go into debt for a car again. You've learned your lesson. And with what you're setting yourself up, the next time you buy a car, it's going to be in cash. And it's not going to be a junker. It's going to be something that you've vetted and looked at and used in Nice, right? You're setting yourself up to be able to do that in the spotlight. Yep. And then when you get that first paycheck, it's all yours because you're debt free because you sold the car. Boom. All right. Let's go to Josh and Boise. He is up next. Hey, Josh.
How are y'all doing great. How can we help? Good. So I've got a couple questions. So first off is my wife and I recently moved to a remote town in Idaho where there is no major companies and there's no handymen up here either. So my wife and I decided this year we're on baby step two currently.
And we've kind of decided that this year might be a good year for me to start a handyman LLC. I've already got all the tools to do it. The only thing that would cost me out the door is the initial startup through the state for the LLC paperwork and the filing fee and all that. So that's roughly about $500.
The downfall is I'm having a really hard time finding business insurance as well as the only thing it would cost me running this LLC is my time and my fuel. That's all it would take. So those are my two main questions. Is starting an LLC at this point in our life a good idea, a bad idea, and then as far as business insurance, I don't know what to do anymore.
uh... so is the problem that when you're looking for business insurance you're just not finding anybody who will offer it or is that the price tell me more about that and also have you yeah tell me that first okay so i've been told by multiple companies that because i am too much of a jack-of-all trade that they won't cover it because of the fact there's too many things that i can do uh... they're telling me that i need to specialize in one or two specific skills if it
But the downfall is if I specialize in flooring, then I can't do trim. If I do trim, I can't do painting, stuff like that. It sounds like a general contractor type. I know it's not that intense, but that's what it's sounding like. Is that the problem that you're calling yourself a handyman and you should be titling the type of work you do differently? Is that what they're looking for? I'm not an expert on business insurance, so I'm just asking questions to see if we can drill it down.
Yeah, no, it's fine. So I could get my general contractor's license. It's not overly expensive, but they do require you to put down one or two specialized skills specifically instead of having a large array of certain things.
And maybe that maybe that is what you do in order to kind of get your foot in the door because I feel like the more you're in this world, the more you're going to learn and it might be a good idea for you to start small. Um, I would. Oh, go ahead. Well, as has, what's the biggest need? If you were to drill it down to two things versus jack of all trades, what do you see as the most lucrative? Well, there's a lot of flooring up here that needs done as well as everybody around here has got a piece of wood busted broken somewhere. So it's.
Yeah, and I don't want to be, I don't want to sneak around the wall or you think that my question is, yeah, could you just do, could you, could you go flooring and trim? And then if someone's like, Oh gosh, well, I need, you know, this help too. You're like, Oh yeah, I can fix your toilet too for an extra 100 bucks. Or I don't know, like, is that plausible just as a freelance type work?
Yeah, it probably could be. Yeah. I'd get into some, I don't want to sound like I don't understand the internet, but I'd get into some chat rooms or like get on Facebook, get in some forums and ask people, hey, what license did you do? How were you able to be a handyman or a kind of jack of all trades and also be insured and see what people who are doing it, how they're insured?
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All right. Today's question comes from Melody in Virginia. She says, my husband and I are in our early 40s and got married last year. While we were dating, my husband bought a house for us. I participated in the whole process and he paid the down payment and the mortgage until we got married.
We have joint accounts, all that we make goes there, and we treat all income as ours. We worked together to pay off the debt we brought into the marriage. My husband recently became very ill and agreed to do some estate planning. I asked him to add me to the house deed and mortgage, but he wants to just stipulate in his will that the house will be mine if something happens to him. I don't care about the house itself, but while
But while I made sure to put him as a beneficiary for everything that is mine, he has friends and family as beneficiaries for what is his. Am I wrong in feeling off about this whole situation? Yeah. I would definitely feel off about this. The truth is, okay, so let's talk about the will thing first because if you were like, hey, I'm not on the deed and there's no will, that would really be a problem. Just looking at it as that, because I'd say, well,
If, especially since you guys bought this thing before you were married, it could go to probate depending on what state you're in. And it would take time for it to really iron out and go to you. The other thought is, but there is a will. Then my next thought is like, have you seen the will? Because I want to see it with my eyeballs on it.
for real. Because if not, depending on what your state is, again, there could be an issue there, then there's the relational side of what's going on here. Why doesn't he want that? And I also want to know, well, why are your friends and family on the other assets? What could it be? A 401k? Anything else? A savings account? Anything else that would have a beneficiary that would be in his name exclusively that she couldn't be on?
Yeah. So what stands out to me, and I'm going to read a lot into this, but this is just what stands out to me. You're in your 40s. You've only been married for a year. It sounds like there's something previous that's playing into this. Like maybe there was a previous spouse or a previous relationship and he has trust issues. Something is going on there. I find that when people are later in life in those relationships, there tends to be more walls up. Yeah. More experience.
experiences that happen with life and because of that people get protective and they want to protect themselves which in one case is totally understandable but also as it plays out in the health of the marriage it ends up being more detrimental than beneficial and that's where you guys have to like really get on the same page so yeah yeah unless to your point that he promised his
brother that he would help pay for the brother's kids call it. I don't know. I think there's something there that makes sense to you, but for you not even to understand why that's a bigger problem to me. You need to know that. You know, Jade, I was stopped by somebody recently out and about and she was very kind, but she was like, can I just ask you a quick question? I was like, sure.
But she was saying that her and her husband are working their way out of debt. She has, I think like maybe, I can't remember the exact word, maybe $20,000 left in her name because they're her student loans. And they were going to go and refinance the house. Well, if they put her name on the deed in the refinance, then they're not going to get as good of a rate because of her credit score and everything.
And so she was like, we want to refinance, but should we hold off till we're debt free or could we go ahead and refinance? And my name might not be on the deed, but I could put it on the deed after I'm, you know, get out of there. Anyways, there was this whole like situation. And I, you know, and I told her, I was like, I mean, yes, you want your name on the deed eventually. It's, and if it's not, it needs to be in the will, like what you're saying, but the
I think the ownership aspect of both being on the deed is important, but also in a short term, if it doesn't make financial sense, save the money and to put your name later if your name is in the will for it. You know what I mean? That can make sense. Just in case something happens to him. Because the whole point again of sharing assets, yes, is from a tactical standpoint, so we want to be smart about that. But it's also from an ownership perspective and a unity perspective.
And depending on the state, I don't want to get this wrong, but depending on the state, let's say that the house was bought, it was bought pre-marriage, it was bought in his name. Technically, let's say that he passed away and there was debt that she didn't know about it. That house, depending on the state, could be treated as an asset and they could sell the house to pay the debt. That's right.
This is important, you know what I mean? It's important A to know your state law, B, it's important to make sure that these assets are protected because it's probably the thing that they have that's their biggest asset that has the ability to generate the most money for her if she were to sell it. So this is an important issue. All right, let's go to Richard in Rapid City, South Dakota. Hi, Richard. Welcome to the show. Hi, thanks for having me. Absolutely. How can we help?
Hi, so I was just let go from my job suddenly this past Thursday. Oh, gosh, I'm sorry. And my question for, we'll make it through where on baby steps three with our expenses saved up. Okay. But my question for Dave was, what should I be doing during this time? Should I be looking for a
Part-time job, maybe, to help bolster that emergency fund. Make sure it doesn't run short or dry, so that we move out of the house. Are there any special considerations? What were you doing before? I was the director of music for a large, well-known church in the area. Okay. Do you see a position opening up and doing something similar anytime soon?
And it's kind of thin. It can take a couple months, three months, conservatively to find a job that's so specific. That matches my very narrow field of expertise. Yeah, for sure. Well, yeah, I would be for doing something in the meantime. And I always feel like the transitional season, like what you're in,
It is harder because, I mean, I think for a lot of people, you kind of have to go into it with a lot of humility being like, okay, I was doing one thing and now I'm doing something I never thought I would be doing, but at least I'm earning a paycheck to keep us afloat because you're right. You don't want to sit there and just drain your emergency fund all the way down, you know, three to four months in. So keeping as much of float as possible. Does your wife work?
She teaches some piano lessons here and there, but she really likes being there to stay at home on. Sure, sure. Yeah, so Richard, I would be doing anything or everything. And again, it's probably, it's not going to probably be in your field of what you're saying, short term. And it may not even be a job you thought you'd ever be in, but you're earning something and bringing something and while looking simultaneously looking for something that you had or it may have, or stuff may have to just shift in your, you know, professional career.
If you hold on the line when we get done with this call, Christian's going to pick up and I'd love to give you some of Ken Coleman's material because he writes about this of whether it's a job loss that is sudden or expected or you decide to change careers because it's not what you're passionate about. Regardless of your reasoning, kind of re-looking and just saying, hey, what other strengths are out there? Because like you're saying, if it is a narrow field,
And if there's not a reality of you getting something very similar to what you're doing, you want something that is full-time, that is fulfilling, but it may look different and maybe something more, you know, that you aren't thinking about. So I'll give you, yeah, Ken's book and he has the Get Clear Assessment, a code for that in his book. And so you can actually take that and it's a great assessment. It's very thorough just to maybe just to get your wheels turning and thinking of other things.
Yeah, thanks for the advice. Would you push me more in the direction of a full-time job or would it kind of depend on the situation?
I mean, I'm of the mind to take any job until you get the job, whatever it is. You know, right now you're unemployed, so let's get something just to keep you going. And if it is full time with insurance and benefits, that's a bonus for sure. You know, and knowing that it may be short term, but getting something that has kind of a well-rounded package I think would be ideal. And if not, you may have to go down to an hourly type job, which is fine too, but yeah, at least you're making something.
Yeah, how did you do you have six months of expenses three months? What do you have? We have got five. Okay. Yeah, I mean, I'd make it my goal to like in two months start, you know what I mean? Like put a goal out there because if you aim at nothing, you'll hit it. So give yourself a clear goal of here's a timeline I want to meet in it and give yourself contingencies. If this doesn't happen, then I'll do this and really write out a clear plan so that you don't feel like you're just floating.
but that you feel like you're making intentional steps in a real direction. Yeah, for sure. Yeah, Richard, hang on. Christian's going to pick up and we're going to give you find the work you're wired to do by Ken Coleman with the Get Clear Assessment to help you maybe, yeah, in just a new direction, kind of take that narrow path and maybe expand it a little and see what else is out there. So good luck to you. I'm so sorry. That is not fun. This is the Ramsey Show.
I still remember 10 years ago, 23 years old, I was frustrated, anxious, and flat broke. I had followed all the ways the toxic money culture had led me down from well-meaning parents and misguided guidance counselors, and it left me with a pile of debt. But I'm telling you, it doesn't have to stay that way. Over a decade, I went from broke to millionaire.
and I break it all down in my new book, Breaking Free from Broke. I'm gonna show you just how toxic this money system is and how you can break free from credit scores and credit cards and student loans and auto loans and investing traps and finally live a life that you're not exhausted by. A life with more margin, more options and more peace. If you wanna check out the book, go to ramsysolutions.com slash store to get your copy of Breaking Free from Broke. That's ramsysolutions.com slash store.
So one of the best ways to make the most of your money is by sticking to a budget, creating a budget, sticking to it. It is the roadmap, you guys, for your money. And every dollar is the best budgeting app to help you plan to spend your money, track it when you spend, save for what matters most, and it is just amazing. So keep a pulse on your spending and really make progress with your goals this year. Be intentional in every dollar again. It is just,
It is my favorite app. I was saying this in our live stream, but I'm not kidding. When I open my phone, you know how you like subconsciously go to things on your phone that you don't realize you're in. Mine is Instagram and every dollar. I end up in every dollar sometimes. Every time I open it instead of Spotify because it's.
Oh, it looks like it. Yes. I know. But for real, Jade and I both, we use every dollar. We love it. It is. It makes it so easy. I just was doing our February budget. I mean, it's, yeah, it is great, you guys. So you can actually download it for free in the App Store or Google Play or click the link in the description if you're watching on YouTube or listening on podcasts because, again, getting great tools with you that are simple and easy and help you make progress. That is like, that's where technology is at. At its best when it's helping you.
Honestly, yeah, make sure to check it out again. That is every dollar. All right. Let's go to Tanner in Tampa, Florida. Hi, Tanner. Welcome to the show. Thank you for having me. Absolutely. How can we help? So I'm in the market of buying a house and I'm looking at buying one and I'm wondering, should I buy a starter home or should I save up for the home that I plan on living in for the rest of my life?
Ooh, you know what? How old are you Tanner? 23. Okay, yeah. You know what Tanner, I'll be honest with you. So much life happens in a five year span, in a 10 year span.
in a 30-year span. So as much as I love the sentiment, the truth is you have no idea what house you're going to live in for the rest of your life. Don't put that pressure on you at your age either. If you were 65, we'd be like, OK, maybe we can decide what else you'll be in for the next 30 years, but not at your age. So don't limit yourself to that. Smart move.
I would say would to be get into something, you know, I, when I say as soon as possible, usually that means a couple of years of savings. So it's not that urgent, but I would be, I would be getting in. So tell us about your financial situation. Do you, do you have any debt? Do you have savings? I just got out of debt. I just paid off my truck. Awesome. How much do you make a year?
Around 90,000. Okay, good for you. And it's just you or do you have? Okay. Listen, that's even another reason to think this through because chances are on down the line, you'll meet a Mrs. Tanner and she's going to have a different expectation of where she wants to live. So right now, I'm with Rachel. I would focus on something smaller, something you can afford. You know, the rule of thumb that we go by is of course you want to
have your three to six months emergency funds saved up, and then you're saving a separate down payment, no less than 5%, but if you can get it to 20%, that's great. And all in house taxes, insurance, HOA, you don't want that payment to be any more than 25% of your take home. And so that's what we're looking at. If you can get a 15 year fixed rate, that is amazing. So that's kind of the standard that if we're saying like good, better, best, that is the best way that you could possibly buy a home. And then above that is just you paying cash, right?
Yeah, and Tanner also remember too, just because of your season of life, you know, from an age perspective that you want to be in your house, you know, I would say for at least five years, four to five years to get kind of the markets, if you will. So there'll be some ups and downs or not really. I mean, yeah, and just you pay so much at closing.
to make sure that you kind of get enough equity built in that it makes sense. So are you in a pretty stable job? Do you think you'll be in the Tampa area for the foreseeable future unless something changes? Oh, yes, ma'am. My job, we travel, but we're based out of Tampa. Okay. I don't plan on leaving and there, I'm
hoping to get moved up soon. Okay, that's great. Yeah. Well, I would do exactly. Yeah, what Jade said, um, start getting that emergency fund in place and then saving up a down payment and yeah, you never know where life takes you in your twenties. It's a pretty, it's a wild decade. It's a wild that can happen. A lot of change, but that's exciting to enter. And let me say this from all the single ladies that work with me here at Ramsey, they're always like, if they're going on a date with a guy, they're always like, he's a homeowner.
Like it's like, it's a thing. It's hard to be on home over these days. And if you're a homeowner and a guy, it's extra points. It just means you're very responsible. So I'll throw that out there for you, Tanner. Yeah, get after it, Tanner. And make sure to, if you want to go check out our real estate home base, you can go to ramsysolutions.com slash real estate. And we have great agents there, Ramsey trusted agents that can help you in the Tampa area when you decide to buy.
And also just some articles and podcasts like just kind of start to learn up on this process of home ownership because the more knowledge you have, the better. Rachel, let's talk briefly about that forever home deal because I hear that a lot and in his case, listen, Tanner's heart is pure. Like he's just a simple guy who just wants to settle down. But sometimes I hear that and it's almost like an excuse
to spend more or kind of like push that barrier. Do you know what I mean? Because like, this is my dream house. We're never moving anywhere else. This is it. And you know, it's funny, even if it's not the quote unquote dream house and your sentiment isn't lifelong, I've had a lot of friends in their sentiments. Oh yeah, we'll be in here to at least the.
the kids go to middle school and it's a 10 year house, but then they get four years in and they're like, oh gosh, the school's where all we thought, the house is at disaster, it's leaking or doing a repair. You just never know. So even, I mean, it is something that you kind of go in with like, you know, this is a big investment. We're gonna be as smart about it as possible, but also don't feel like you're like crushing your dreams. If you set out to think like, oh, we're gonna be in this for X amount of time,
Life just changed. There's no way to know. Yes, there's no way to know. It's a great point. It's a great point. All right, real quick, let's go to Gregory as we finish out this hour of the Ramsey Show. And he's in Washington, DC. Hey, Gregory, welcome. Hi, how are you guys? Can you hear me? Yes, we can. How can we help? Hi, good afternoon. And my name is Greg. I'm 26 years young, and I have
A lot of credit card debt and on top of that collections as well. So in total, I have 13,105 and credit card debt split between four different cards and 1760 with collections. Okay. My question is, is should I pay the collections first or should I try and attack the credit card with the scover?
because they are, they're like giving me a lawsuit for attorneys. I don't know which one I should be paying first. Well, they're, they're both, they're almost equally important. The discover one, how much is it? What are you on the hook balance wise? 6,031. Okay. And then just for clarity, the collections, it's 1,760. Is that what you told me? Correct. Okay. So, okay. How long has it been in collections?
Um, one, I have two in collections. One has been in collections for about a year and a half and then the other one in collections for around four months. Okay. Do you have any money saved? Like $400, $500. I have $9 saved, so probably not.
Okay. So what I would do, Gregory, is if you can, I would be getting an extra job. I mean, I would be working 80 hours a week, getting any amount of money, because the ones in collections, you're going to have a better time negotiating those down. And depending on how long they've been, and especially the one that's been in there a year and a half, I mean, it's been probably sold four different times to four different companies and some guy in a cube and who knows. I mean, like it's just, it is, it is long gone and they will be more likely to settle with you. Super cheap.
So that would be probably my first goal. And then, I mean, I would tell Discover, I'm gonna be keeping my minimum payments, but sorry, guys, I'll get to you when I get to you. And listen, they might sue you, but you don't have anything. They have nothing to take. And so that process, it's really more, at this stage, it's likely more of a scare tactic. So just after these collections, it's the next thing in your debt snowball. What's your income? What are you bringing in every month? Because you got $9 saved. Tell me real quick, because we're about to head out.
right now I'm making 21 per hour but it's more so part-time. Okay so there's your issue right there and I think you know what we're going to tell you you've got to get up to full-time a full-time schedule full-time at 21 per hour you can get some things done but let's find a way to get that income up because that's really the key to this puzzle. Full-time and overtime Greg that's going to be your forever young if you will this is use that young energy to be working.
Thanks to all the guys in the booth. Jay, thank you for a great hour and we'll see you guys at the Ramsey Network app. If you are on radio, stay tuned and we will see you next hour.
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